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China Embraces iPhone 5 Amid Reports of a New iPhone in June

Apple brought the iPhone 5 to China and sold 2 million-plus in three days. The next iPhone could arrive as early as June, say analysts.

Apple is far from dominating the smartphone market in China, but it nonetheless saw record sales of the iPhone 5 after the device went on sale there Dec. 14. Over three days, Apple sold more than 2 million units in China.

"Customer response to iPhone 5 in China has been incredible, setting a new record with the best first weekend sales ever in China," Apple CEO Tim Cook said in a Dec. 17 statement. "China is a very important market for us and customers there cannot wait to get their hands on Apple products."

By the end of December, the iPhone 5 will be available in more than 100 countries, making it the fastest rollout of an iPhone ever, Apple added. And still, more countries are expected to receive the iconic device, if not additional devices.

Canaccord Genuity analysts, in a Dec. 16 report, told investors they believe Apple is beginning to use larger distributors to increase iPhone sales in international markets.

Further reading

"We believe Apple could launch a refreshed iPhone 5 along with a more mid-tiered priced competitive iPhone for prepaid-oriented international markets this summer. ... We believe Apple is in the early stages of testing prepaid-oriented international channels for potential future iPhone launches," wrote report lead author T. Michael Walkley. "In fact, we believe Apple can generate strong iPhone sales growth in large under-penetrated markets such as Eastern Europe, Latin America and Southeast Asia over the next several years."

Walkley added that while in recent years Apple has introduced a new iPhone in the fall, it may be planning a June-quarter launch for its next iPhone.

"While order reductions to iPhone suppliers are not unusual this time of year," said the report, "we believe Apple's reduced iPhone 5 orders for the March quarter could also indicate an earlier launch of new iPhone products in the June quarter."

Channel checks suggested iPhone 5 sales were currently strong, but for fiscal 2013 and 2014, Walkley lowered his iPhone and iPad estimates, pointing to "softer sales expectations in international markets, primarily in Europe."

In recent quarters, Samsung has outsold Apple and overtaken Nokia as the world's leading phone maker. During the third quarter, Samsung sold 55 million smartphones and 98 million phones overall, compared with Apple's 23.6 million iPhones, according to Gartner.

In May, Samsung introduced the Galaxy S III, taking advantage of a summer's worth of sales without a new iPhone to compete against. In November, the company announced that it had sold more than 30 million of the devices, which feature a 4.8-inch display and have helped make pocket-challenging display sizes more of a norm.

Apple executives have insisted that making money isn't Apple's number-one priority. "Our goal and what makes us excited is to make great products," Jonathan Ive, Apple's senior vice president of industrial design, said at a summit at a British embassy in July. Still, making money is somewhere high on the company's priority list, and a June-quarter launch of a new iPhone would help it to do that and to prevent Samsung from making another private buffet of summer smartphone sales.

Canaccord Genuity lowered its 2013 iPhone unit sales forecast from 174 million to 172 million and its 2014 estimate from 229 million iPhones to 215 million.